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Patent Litigation

If you own a patent, and you believe it has been infringed, you will have to pursue your claim through civil litigation in the federal court system. After anti-trust litigation, patent litigation is second most expensive. And because complex issues are involved, patent litigation is lengthy (it can take years to go to trial or reach an out-of-court settlement) and very, very expensive!

The Players in Patent Litigation: In civil litigation, the party filing the lawsuit is the “plaintiff.” The party that is being charged with Patent Infringement is the “defendant.” Since a person charged with a crime is also a “defendant,” some people confuse the issue of guilt with that of negligence. In a criminal trial, the defendant is found guilty or not guilty, while in a civil trial is settled in favor of the plaintiff or in favor of the defendant. Both the plaintiff and defendant are usually represented by attorneys or law firms. Attorneys who try cases in court art called “litigators.”

Patent Agents, Patent Attorneys and Patent Litigators: Patent agents help clients secure patents for their inventions (this is called “prosecuting a patent), but patent agents are not attorneys, so they do not represent clients in court. There are also Patent Attorneys who also help inventors prosecute their patents, and many specialize in patent prosecution and do not represent clients in patent litigation. Some patent attorneys also represent clients in patent litigation, and there are law firms that specialize in patent litigation. Some plaintiffs in patent litigation use the services of a Patent Enforcement Firm. A patent enforcement firm is not a law firm; it provides patent infringement and patent enforcement expertise, it finances the cost of the litigation, it assists in negotiations with the defendant and in working out licensing agreements, and it engages the patent litigators who actually try the case.

Patent Litigation Awards and Settlements: The patent owner whose believes his (or her it its) patented invention has been infringed can file a patent infringement lawsuit against the alleged infringer. The awards made by courts in patent litigation can run from a few thousand dollars to several million dollars. Robert Kearns, the inventor of intermittent windshield wipers who was the subject of the movie “Flash of Genius,” received a $10.2 million settlement from Ford Motor Company. Compensation for patent infringement is usually a lump sum payment that is either awarded by the court at the conclusion of a trial or an amount negotiated among the parties as part of an out-of-court settlement. If a patent owner wins his patent litigation and is given an award by the court, and the patent infringer wants to continue to practice the patented invention, that company will likely enter into a licensing agreement with the patent owner. This is often called “stick licensing” since the user of the patent in forced to license the patent.

Patent Litigation Outcomes: In the current US civil court system, it takes at least several months – and more likely several years – to bring a lawsuit to trial. As a result, the filing of the lawsuit is often part of a larger strategy to force the defendant to negotiate a settlement. In fact, thousands of patent infringement lawsuits are filed every year in the US, but less than 100 of them go to trial. Most plaintiffs are able to negotiate an out-of-court settlement with the defendant. For the both the plaintiff and the defendant, an out-of-court settlement is safer than the risk of going to trial and winning big – or losing big. Also, a trial verdict can be appealed and the terms of the settlement are a public record, while an out-of-court settlement is final and the terms of the settlement are private.